5 Hanover Square to be sold for $105M

Savanna is selling the office building located at 5 Hanover Square to Los Angeles-based real estate firm CIM Group for roughly $105 million, double the amount it paid for the property just three years ago, according to sources.

Savanna took control of the 335,000-square-foot building in 2010 after buying its mortgage for $51.5 million. The building's previous owner, Kent Swig, agreed to surrender the property to Savanna after going into default. Savanna kept Mr. Swig on as the leasing agent of the building. During Savanna's ownership, Mr. Swig helped arrange several transactions with tenants that brought the property to about 95% occupancy, a source said.

"The market really turned around, [Savanna's] strategy of buying notes was spot on," said Robert Knakal, chairman of the brokerage company Massey Knakal Realty Services, who sold 5 Hanover Square’s mortgage to Savanna on behalf of Capital One Bank. "They’ve done extraordinarily well."

Downtown Manhattan has become an increasingly popular destination for tenants as other neighborhoods, like midtown south, have risen in price.

Adam Spies and Doug Harmon, brokers at Eastdil Secured, arranged the sale for Savanna. Messrs. Spies and Harmon declined to comment, as did Savanna.

CIM Group has been an active buyer of real estate in the city in recent years, acquiring 11 Madison Ave., and 432 Park Ave., a super-luxury residential building that is now rising on the corner of East 56th Street.

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